In a shocking turn of events on November 17, 2023, OpenAI’s board of directors removed co-founder and chief executive Sam Altman after the board determined that they had no confidence in Altman’s leadership. 

“Mr. Altman’s departure follows a deliberative review process by the board, which concluded that he was not consistently candid in his communications with the board, hindering its ability to exercise its responsibilities,” the company said in its blog post. “The board no longer has confidence in his ability to continue leading open ai.”

Mira Murati, the Chief Technology Officer, has assumed the role of interim CEO with immediate effect. The company is initiating a search to find a permanent successor for the CEO position.

OpenAI, founded in December 2015, initially aimed to advance digital intelligence through experimentation and progress, illustrated by initiatives like openai gym and the development of ‘OpenAI FIVE.’ The transformative development came with the birth of chat gpt in November 2022, marking a pivotal moment in the field of generative AI.

In 2019, OpenAI underwent a strategic shift, transitioning from a non-profit to a capped-profit model. This change aimed at navigating legal complexities while balancing the need for capital with the organization’s mission. 

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Microsoft’s substantial involvement played a key role, with CEO Sam Altman successfully securing a $10 billion investment from Microsoft and orchestrating tender offer transactions that significantly increased OpenAI’s valuation. 

This strategic transition added a layer of complexity to OpenAI’s structure, with a non-profit controlling a for-profit entity, managed by a capped-profit company, OpenAI Global, LLC. 

The majority ownership by a holding company, inclusive of employees and investors, further distinguished OpenAI’s intricate organizational model, while Microsoft held a minority stake in the capped-profit segment.

 

ChatGPT has experienced a meteoric rise since its launch, captivating users worldwide with its advanced language generation capabilities. The platform quickly garnered a user base of 100 million, showcasing the widespread appeal of its natural language processing. 

Building on this success, the unveiling of gpt 4 marked a significant leap in AI technology. This latest iteration introduces groundbreaking advancements in text, image, and voice analysis, pushing the boundaries of what’s possible in artificial intelligence. 

The integration of enhanced features and capabilities in gpt 4 further solidifies OpenAI’s position at the forefront of innovation in the field of language models and artificial intelligence.

According to various media reports, Ilya Sutskever, a vocal critic of advanced artificial intelligence, played a pivotal role in Altman’s removal. 

Before his exit, Altman was actively seeking funding in the billions from Middle Eastern sovereign wealth funds to develop an artificial intelligence chip competing with Nvidia. However, Sutskever and his allies opposed these efforts, viewing them as exploiting the OpenAI name. 

Altman’s decision to reduce Sutskever’s role in October 2023 deepened divisions, leading to a successful appeal by Sutskever to several board members. 

Reports indicate that opposition to Altman’s profit-centric approach came to a head during the DevDay conference, where Altman announced custom chat gpt instances. Disagreements over the safety of artificial intelligence had already caused divisions among employees prior to Altman’s removal.

The substantial shift in leadership triggered a series of events within OpenAI, leading to the departure of key figures. Co-founder and president Greg Brockman publicly announced his exit shortly after Altman’s removal. 

Additionally, reports indicate that several senior staff members, such as Jakub Pachocki, the director of research; Aleksander Madry, the head of preparedness; and Szymon Sidor, a senior researcher, have tendered their resignations.

The technology sector experienced a negative impact on stocks due to Altman’s removal, with Microsoft shares dropping nearly three percent. Worldcoin, an iris biometric cryptocurrency co-founded by Altman, saw a twelve percent decrease in value, as reported by CoinDesk. 

Altman’s removal poses a risk to a share sale led by Thrive Capital, potentially affecting the company’s valuation at US$86 billion. 

Furthermore, the development may create opportunities for OpenAI’s competitors like Anthropic, Quora, Hugging Face, Meta Platforms, and Google. The overall consequence could be a slowdown in the progress of the artificial intelligence industry.